A fresh wave of fear over the ongoing tensions between North Korea and the US weigh heavily on the FTSE 100, which opens down by 25.77 points to 7347.26. Even decent results by homebuilders such as Barratt Developments (BDEV) could not shake the negative sentiment.
Shares in the housebuilder are down 3.1% to 604p despite hiking its ordinary dividend per share by 39% to 17.1p as well unveiling a 17.3p special dividend. Its year ending 30 June results also show pre-tax profits up 12.1% to £765.1m.
The company says it has achieved its targets set in 2014 including a gross margin of 20%, over a percentage point better than 2016 when it stood at 18.9% as well as its highest return on capital employed in 12 years at 29.8%. It now has a net cash position of £723.7m.
Peer Berkeley (BKG) shares are also down, by 2.8% to £36.48. The company’s trading statement says that it is ‘on track to deliver at least £3bn of pre-tax profit in the five years ending 30 April 2021, with profits for the current year anticipated to be at least as strong as 2016/17’.
However, it also warns that the London market is adversely impacted by Brexit, recent changes to stamp duty land tax and ‘mortgage interest deductibility’.
Berkeley is also planning to return £2.2bn to shareholders by 2021 in the form of dividends and share buy-backs with the initial sum of 200p per annum being increased to 204p following share buy-backs undertaken since January 2017.
UK retailer Sports Direct (SPD), run by the controversial Mike Ashley, shares are up by 2.6% to 394.05p as it releases a trading statement saying its new generation of flagship stores are exceeding expectations. It says the stores are moving the company ‘towards the “Selfridges' of sport’ and hope to grow underlying earnings before interest, tax, depreciation and amortisation by 5% to 15% during 2018.
Oil and gas industry service provider Petrofac (PFC) shares tick up 4.1% to 428.1p after being awarded a contract worth over $700m on Sakhalin Island. The island off the coast of Russia will be host to a project comprising of a lump-sum engineering, procurement and offshore fabrication component, as well as a reimbursable element for construction and site services.
Software company Sophos (SOPH) shares are up 2.5% to 547.5p as the company releases a trading statement. The company’s CEO Kris Hagerman says ‘we are pleased to confirm that the strong momentum in billings growth we reported in the first quarter of 2018 has accelerated in our second fiscal quarter to date and as a result we now expect full year 2018 billings growth of around 20%, compared to our previous guidance of mid to high-teens growth’.
UK Software firm Micro Focus (MCRO) enjoys a 6.7% share price lift to £23.54 as it reveals the financial results of Hewlett Packard Enterprise (HPE), which was subject to a $8.8bn merger with Micro Focus. HPE revenues for the nine months ending 31 July stood at $2.1bn. Its operating profit was $804m for the same time period.
